Accounting Standards Board

Accounting Standards Board

Accounting Standards Board Paper
Accounting is defined as the practice of recording, analyzing, and reporting the financial transactions of an organization (Schroeder, Clark, & Cathey, 2011). Since 1973, there has been a governing body that has determined what is considered acceptable business practices in regard to the relationship between these functions. In the United States, that governing body is known as the Financial Accounting Standards Board or FASB.   FASB helped to refine and establish what is known as the Generally Accepted Accounting Principles or GAAP. These principles have laid the foundation for modern day accounting practices and have served as a road map for financial accountants worldwide. In 2001, a new board was established to bring unity to international accounting practices. It is known as the International Accounting Standards Board or IASB. IASB has its own set of standards commonly known as International Financial Reporting Standards or IFRS. Together these two entities lay the groundwork for accountants to follow to most accurately and ethically report the financial activities of their respective organizations.
Although both these organizations have striking similarities and strive to serve a common goal, there are marked differences in their approach to financial reporting standards. In recent years, FASB and the IASB have affirmed their commitment to bring together their basic fundamentals and create a unified accounting resource that will become the standard for accounting practices across the world. This effort is known as the FASB/IASB convergence project. This project will address and make efforts to eliminate the existing differences between the two boards.   The ultimate goal of this project will be to provide an authoritative source for high-quality international standards that will be utilized both domestically and across borders for financial reporting purposes (FASB, n.d.).   Currently the project is underway and both...